Thursday, September 01, 2005

Mexican social security news

Considering the tendency in Mexico to use social policies for political gain, the Secretary of Health, Julio Frenk, insisted this week that Seguro Popular , a program providing health insurance to those not covered by social security, would not be used for political purposes by the president's party, the PAN. The criticism would be that benefits are targeted to current PAN supporters or selectively given to potential PAN supporters, rather than being distributed according to objective criteria of need or eligibility. In general, since Zedillo, most targeted poverty programs have received better marks for not being so obviously politically manipulated, but recent studies, including an on-going one by a Berkeley student, suggest that programs are still targets for political manipulation, at least at the margin. (I would link to her work, but it's not online, that I know of.)

First, as many of the people I interviewed predicted, the courts rejected the union's petition for an injunction against the law passed in August 2004 that changes the pension system for all new social security workers. The union can appeal again, but it is more likely that the union will look for new ways to fight the administration's attempts to curtail their benefits and cut labor costs.

Second, the union's claim that failures of the administration to efficiently collect and handle resources may represent that new strategy. The union is claiming that mismanagement has cost social security $1,500 million pesos (about 1.3 million US$). The claim was made at the presentation of a new book by the union:

Pérez Saucedo was one of several union leaders that I interviewed in May or June, and he was finishing this book at the time of our interview. I think it's interesting that he is quoted as arguing that one of the intentions of the IMSS administration is to privatize the institution, something I have suggested may be a motive for confronting the union.

Others at the book presentation included a former Director of the social security institute in the 1980s, whom I have also interviewed before.

One researcher who consistently criticizes the social security administration was also there to point out that salaries and labor costs of the administration have increased by 400% over the last few years.

The court decision and the union's criticisms of the administration are all going to color the upcoming labor contract negotiations that will occur before October.